The main social indicators for Peru show positive progress, but also reveal a persistence of important inequality problems.
The Peruvian economy remains largely based on the extraction and export of raw materials, mainly minerals and gas. This does not only make the country structurally vulnerable to external demand and supply shocks in global markets, but also feeds discontent and social conflicts.
Peru is now the world's largest producer of cocaine. Organised crime linked to the production and trafficking of illicit drugs negatively affects stability in the region.
In the perspective of the phasing out of bilateral development cooperation, the EU will focus its support on improving social service delivery at local level, continuing its support to the fight against drugs as well as on fostering sustainable trade with a focus on small business development.
An additional EU objective is that the Multi-Party Trade Agreement be implemented in a mutually satisfactory manner for the parties and that Peru maximises the benefits that will accrue from it.
Under the 2014-2020 Development Cooperation Instrument (DCI), €66 million has been allocated to Peru.
Peru benefits from the Regional Cooperation Programmes for Latin America (LA). With €805 million foreseen for the LA regional Multi-annual Indicative programme (MIP) 2014-2020, priorities addressed are the security-development nexus; good governance, accountability and social equity; inclusive and sustainable growth; environmental sustainability and climate change; and higher education via Erasmus+ 2014-2020.
Peru participates in ALFA (higher education cooperation), Erasmus Mundus (university students and academics mobility), EUROsociAL (social cohesion and good governance), AL-INVEST (internationalisation of SMEs), URB-AL (urban local development), EUROCLIMA (climate change), RALCEA (water sector knowledge centres), LAIF (infrastructure), EURO-SOLAR (energy for isolated communities), @LIS (information society) and COPOLAD (cooperation on anti-drugs policies).
In addition, funds from thematic programmes are made available for LA regional cooperation. Peru is benefitting from the WATERCLIMA programme (watershed and coastal management).